Oh, my bleeding heart...

So I mentioned in my last post that I try to "live by my principles." What does that mean for me? Well, it means a few things:

• Working for nonprofits - In my profession, I work only for non-profit organizations. The majority of my work history has been with non-profits, and I will probably spend the rest of my life working for them.
• Being a vegetarian - I haven't eaten meat since I was thirteen. This is a personal choice for me. Disclaimer: I'm not judging other people or their choices, but this is what's right for me. There are many reasons why I choose to be a vegetarian. If it's something you've ever considered, you may be interested in a FREE Vegetarian Starter Kit.
• Being a Caring Consumer - I try to never buy from companies that test on animals. Instead, I give my hard-earned money to companies that DO NOT test on animals.
• Buying green - This goes hand-in-hand with being a caring consumer. I try to buy mostly environmentally-friendly products.
• Giving back - Yes, I want to live comfortably and be smart about my money, but it's also important to give money back to ethical charities. Two of my favorite charities are the ASPCA and Farm Sanctuary. Giving back can be as simple as a click of your mouse.

And yes, I am proud to call myself both a bleeding heart and a tree hugger.

Green Banking

Green banking is something I don't know much about, but would like to learn. I happened to find this article on the importance of ethical banking. It hits close to home because I try to be an ethical consumer and live by my principles, but I know I'm not doing as much as I theoretically could be doing.

Indulgences

My biggest indulgence is my passion: belly dance. I love to belly dance. I’ve danced since I was a child, but only started belly dancing about a year and a half ago. It’s one thing I consistently let myself indulge in. I take classes 1-2 times a week, which adds up to around $80 a month. I also have a small collection of instructional DVDs, which I love. I’ll be in my first performance this August, so I’ve started buying some costume pieces. The best (and most expense) dance-related purchase I’ve made is my Melodia pants. I’ve never spent so much money on a pair of pants before, but they are so worth it. I have several pairs, but my favorite are my burgundy mehndis. I’m not usually one to get excited about clothing, but I love my Melodias to pieces.

Goals for July

• Transportation challenge - I've set my goal for my July transportation budget at $80
• Get my free credit report - I've been planning to do this for months but never actually gotten around to it.
• Begin 403(b) contributions - whether I stay at my current job or accept the other job offer
• Enroll in online bill pay for car loan - Once I do this it'll make it easier for me to make payments on time and to keep track of how much I have left to pay off.
• Know my networth - I don't know the exact balances left on all of my loans in order to calculate this. It'll take me some time to get all the information together, but I like the idea of being able to keep track of my worth and (hopefully) watch as it increases!
• Get my Avon orders in on time - I have trouble with this as I'm a huge procrastinator and, as I've said, a bit apathetic when it comes to the whole Avon thing. But I have to pay a fee each time I turn my orders in late, so I need to get on top of it.

July Transportation Challenge

For the month of July, one of my goals is to participate in the transportation challenge from Give Me Back My Five Bucks. My transportation budget for the month will be $80. This should be enough money for me to fill up my tank twice. I'm fairly sure that'll be enough to get me through the month, but we shall see.

This month I've started to track my spending in order to develop a budget for myself, so I'm not sure yet how much I usually spend on things. I've never been one for budgets - I've always just tried to guess-timate when it came to spending. It's worked for me to some etent in that I almost never spend more money than I have and usually have a comfortable cash cushion in my accounts. This past month I've decided to buckle down and really pay attention to where my money is going so that (hopefully) I can get to the point where I'm able to save more. Budgeting can get rather tedious, though. I hope I'll be able to stick with it.

Some of the ways I save money

These aren't earth-shattering ideas, and I'm sure you've heard them before, but these are some of the strategies I use to help save money:

Conserving Electricity – I use natural light as much as possible and only turn on lights when absolutely necessary, and turn them off when I leave the room. We have all compact fluorescent bulbs in our apartment. I only run the dish washer when I have a full load and skip the dry cycle. I try to only do full loads of laundry and wash nearly everything on cold.

Clothing – I have a good-sized wardrobe, but I don’t spend a lot of money on clothes. Many of my clothes come from Target and, regardless of where I buy, most items are purchased on sale. I take good care of my clothing so it lasts me a loooong time. I don’t usually purchase ‘trendy’ clothes, so I can wear things for years after purchasing. (Confession time – I still have a few shirts I wore in high school. I don’t wear them out, but they make great pjs.)

Hair – I don’t do ‘product’. I don’t have any hair appliances other than a blow drier, which I rarely use as my hair dries pretty quickly on its own. I don’t wear hair accessories – I like a simple look. I buy a good shampoo and conditioner and that’s about it. I get a trim every few months, but don’t pay to have my hair styled. I have long straight hair, so it just doesn’t require a lot of work.

Personal care – As I admitted in a previous post, I’m an Avon representative. I get discounts on items I buy for myself and make a small profit from the things I sell to others (which in turn helps me pay for my purchases). I rarely have to dip into my personal money to pay for my own purchases.

Gas – I drive a Honda Civic, which gets great gas mileage. These days I live only 15 minutes away from work and rarely make long drives. I can usually go about two weeks on one tank of gas. I also have a Giant Eagle Advantage card which allows me to earn Fuel Perks (discounts on gas). I tend to let the perks add up and then drive in one day when I’m on E and fill up. I once paid under a dollar for a full tank of gas this way!

Avoiding the mall – Lucky for me, I’m not one of those people who uses shopping as a source of entertainment. I rarely go to the mall unless there is something specific I must go there to buy. Going to the mall to ‘browse’ only leads to impulse purchases. If I must go to the mall, I try to only visit the store(s) I need to go to and then GET OUT as fast as possible.

Extra Income

I need a way to earn extra money, but I'm not sure how. I have a full-time job and was thinking about looking for something part-time as well, but my regular job is extremely demanding and stressful. By the end of the day I'm exhausted, and I just can't imagine myself being able to hold down a second job and still remain sane. Overtime isn't a possibility where I'm at, but I do have the potential to earn an extra $4000/year with my quarterly bonuses. Even so, I would still like to earn some additional money to help pay down my debt and save as much as possible!

Some Possibilities:

• Sell Avon - I'm already a representative, but I only sell it to a few select people and don't make much money off of it. I'm sure there is the potential to earn more, but I'm not very into makeup and such, which makes me pretty apathetic towards the whole thing.
• Mystery shopping - It's something I've considered before, but never done.
• Sell some of my books & CDs - I have a ton of old CDs; even if I only get a few bucks for each of them it could add up to something. I usually have a hard time parting with my books, but there are a few I have that I really don't care to keep.
• Tutoring
• Baby sitting - I haven't done baby sitting in forever, but I suppose it's always a possibility.

My Financial Goals

Short-term Goals (1-2 years)

• Contribute $5,000 to my Roth IRA - in 2008
• Earn my bonus each quarter this year - This would add up to $4,000 for the year. Of course, that's assuming I stay at my current job.
• Find an additional source of income
• Have an emergency fund of at least $3,000 - by next year
• Have a $3,000 travel fund - by summer 2009

Mid-term Goals (2-5 years)

• Save a total of $25,000 across all investments - This includes amounts specified in other goals
• Save at least $10,000 for a down payment on a home

Long-term Goals (5+ years)

• Get out of debt - I don't know if I'll ever be fully out of debt due to my school loans and then one day having a home. I'd like to at least limit it to 'good' debt. I have very little credit card debt and would like to pay off my car.
• Save a total of $50,000 across all investments

Saving Money on Groceries

I had planned to go grocery shopping today but we had thunderstorms on and off all day and I decided I didn't really feel like leaving the house. It'll have to wait a few days. I clipped coupons for the first time in years and I'm proud of myself. I recently read a couple articles about women who save ridiculous amounts of money using coupons and store discount programs:

If I Didn't See It With My Own Eyes...
This Lady Has a Black Belt in Shopping

The second link is about Stephanie Nelson, aka Coupon Mom. I spent some time on her website and found some useful coupons, but not all of them would print for me. Maybe it's just my computer. I downloaded her ebook on saving money on groceries. Now I just have to actually read it...

Groceries are a huge expense for me. I'm a vegetarian and tend to eat a lot of specialty foods. I prefer to buy organic when possible, and try to stay away from overly-processed foods. Groceries have always been the one thing I let myself indulge in. I'm thrifty about most everything else, but I never like to feel like I'm denying myself when it comes to food. I like to eat! Setting a food budget for myself is going to be a difficult task.

Retirement: Ya Gotta Do It Someday…

Yesterday I did something I probably should have done awhile ago: I opened a Roth IRA. It’s something I had thought about doing before, but I was paralyzed by fear… I didn’t know the 'right' way to start a retirement investment, so I did nothing. Yesterday I finally decided that it would be smarter to start saving for retirement now without having a perfect strategy, than to sit around waiting for answers that I wasn’t finding. What spurred me to finally make the plunge was an article on the U.S. News and World Report website: Financial Tips for 20-Somethings. The article interviews Ramit Sethi, creator of the I Will Teach You to Be Rich blog. In it, Sethi is quoted as saying :

There's a funny idea in our culture that more information is always good. But as Barry Schwartz noted in The Paradox of Choice, the more choices we have, the less likely we are to do anything. In a study about 401(k) participation, he wrote, "For every 10 funds added to the array of [401(k)] options, the rate of participation drops 2 percent."

So if the average 20-something sees 20 fund choices at work for his 401(k), TV commercials about annuities, blog posts about Roth IRAs, and newspaper columns about not spending so much on lattes every day, what do you think he'll do? Chances are: nothing. Over half of 20-somethings don't contribute to retirement accounts. Forty percent don't even deposit money regularly in a savings account.

He goes on to say:

Getting started is more important than being the smartest person in the room. If I had a choice between being 100 IQ points smarter or starting to invest earlier, I'd choose starting earlier. I encourage young people to read enough to get started but not to worry about knowing every investing instrument under the sun.

This made perfect sense to me. To get started, I moved $3,000 out of a money market investment and into a retirement account. It was the minimum investment, but I wanted to have something left in the money market as it’s my emergency fund. So now there’s $2,500 in the money market and $1,600 in my basic savings account, making my total amount in savings a whopping $7,100. It could be worse. In fact, the majority of my friends have absolutely NO savings.

I actually started saving several years ago, but as I’ve been living hand-to-mouth for the last two years while I was in grad school, I wasn’t in a place to be able to regularly contribute to my savings accounts. Now I’m out of school and finally earning some money, but I also have the added expenses of student loan payments and am finally contributing a full 50% to our living expenses, which was impossible for me to do before.

Welcome!

Hello, and welcome to my new blog!

I am a recent graduate and started a new job three weeks ago. Fresh out of school, I’m finding myself $60,000 in student loan debt, with a meager $7,000 in savings. To add to the pain, I work in a field where I will most likely never earn a large salary. (I am, however, very happy in my chosen career, which is the important part for me.) Since my earning potential is somewhat limited, I’m looking at ways to save money in order to stretch my salary as far as possible.

I’m starting this blog as a way to keep track of my progress towards my financial goals. As someone who knows only the very basics about personal finance, I have a lot to learn. I’ve also gotten into some bad habits while I was in school, because money was not my top priority. I stopped sticking to a budget, keeping track of where my money was going, and taking simple steps to save money on everyday expenses (such as clipping grocery coupons). Now that I’ve met my goal of earning my Master’s degree and getting a job in my field, I’m planning to be more cautious with my money.

Luckily, I’ve always been careful with my money, which means I have an excellent credit rating and almost no credit card debt. I have several goals for myself and my family, which I will be addressing here. Some of my interests include, saving, investing, smart shopping, and real estate. I’m hoping that keeping this blog will help me to keep my long-term goals in mind and give me the motivation to be more conscious of my finances.

Disclaimer: I am not a financial adviser. This is meant to be a personal finance blog and not a source of financial advice for others. Please consult a financial professional for assistance.